The Association of University Teachers has abandoned its historic policy of support for a return to full state-funded grants for all students.

But AUT delegates at last week's annual conference said that while they accepted the likelihood of some form of income-contingent graduate tax, they will continue to argue the case for a publicly funded university system.

Delegates voted overwhelmingly at the conference in Weston-super-Mare for reform given the probability that the Government, the Labour party and the Dearing inquiry are all coming round to some form of graduate taxation, at least to cover maintenance costs.

Union president Joanna de Groot said: "The question is where is the funding going to come from? If you were to restore the 1979 grants base you would be talking about costs, and this is a Treasury estimate, of Pounds 12 billion."

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The AUT is now committed to participating fully in the Dearing inquiry Q including the debate on student funding Q while retaining its insistance that ÖйúAƬ should remain free at the point of entry and that the alleviation of current levels of student hardship is a priority.

Conference also voted separately to press all political parties to address underfunding while stressing that the Dearing committee should not use present funding levels as the starting point for its review.

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Similarly, there was unanimous support for a motion condemning performance- related pay. The AUT is to step up its fight against PRP and relevant advice will be issued to all local union branches within the next fortnight.

Conference delegates also instructed the union executive to open discussions with lecturers' union Natfhe, the Educational Institute of Scotland and Unison with a view to forming a single association to represent all professional staff Q academic and academic-related Q in all ÖйúAƬ institutions in the United Kingdom.